Moody’s assigns Baa3 to Shanghai Huayi notes

Moody’s Investors Service said it assigned a Baa3 rating to the proposed dollar-denominated senior unsecured notes to be offered by Huayi Finance I Ltd. and guaranteed by Shanghai Huayi (Group) Co. Huayi Finance I Ltd. is an indirect wholly-owned subsidiary of Shanghai Huayi.

Proceeds will be used to refinance Shanghai Huayi’s debt and for general corporate purposes.

“The Baa3 rating on the proposed notes reflects the irrevocable and unconditional guarantee from Shanghai Huayi and the fact that the securities will rank pari-passu with other present and future unsecured and unsubordinated obligations of Shanghai Huayi. The proposed notes will not materially increase Shanghai Huayi’s overall debt level because the majority of the bond proceeds will be used to refinance the company’s existing debt. The notes will also improve Shanghai Huayi’s liquidity and debt maturity profile,” Moody’s said in a press release.

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